
Tic Ci~ 



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UNITED STATES DEPARTMENT OF AGRICULTURE 
BULLETIN No. 639 

Joint Contribution from the Bureau of Animal Industry, JOHN R. MOHLER, Chief 
and the Bureau of Markets, CHARLES J. BRAND, Chief 



Washington, D. C. 



February 15, 1918 



THE MARKET MILK BUSINESS OF 
DETROIT, MICH., IN 1915 



By 

CLARENCE E. CLEMENT, Dairy Division, Bureau of Animal Industry 
and GUSTAV P. WARBER, Bureau of Markets 



CONTENTS 

_ Page 

Economic Phases of the Market Milk Business . . i 

Market Demands and Sources of Supply 2 

Buying Milk from Farmers , - _, 4 

Prices Paid to Farmers , 4 

Collecting and Handling Milk in the Country g 

Cost of Collecting Milk at Country Stations 10 

Transportation of Milk to the City H 

Cost of Milk Delivered to the City 13 

Trade Demands in Detroit 14 

Preparing MUk for City Distribution '.'.'.'.'.'.'. 16 

Before Compulsory Pasteurization 16 

After Compulsory Pasteurization 17 

Capital Invested and Cost of Handling Milk at City Plants .... 18 

City Distribution of Milk 19. 

Summary of Comparative Costs of Handling and Distributing Milk . . 23 

Conclusions 97 




WASHINGTON 
GOVERNMENT PRINTING OFFICE 

1918 



Monograph 






D. of D. 

MAR 15 1918 



UNITED STATES DEPARTMENT OF AGRICULTURE 

BULLETIN No. 639 

Joint Contribution from the Bureau of Animal Industry, 

JOHN R. MOHLER, Chief, and the 

Bureau of Markets, 

CHARLES J. BRAND, Chief 





Washington, D. C. 



February 15, 1918 



THE MARKET MILK BUSINESS OF DETROIT, 
MICH., IN 1915. 



By Clarence E. Clement, Dairy Division, Bureau of Animal Industry, and 
Gustav P. Wakbee, Bureau of Markets. 



CONTENTS. 



Page. 

Economicphases of the market milk business. 1 

Market demands and sources of supply 2 

Buying milk from farmers 4 

Prices paid to farmers 4 

Collecting and handling milk in the country . 8 

Cost of collecting milk atcountry stations. 10 

Transportation of milk to the city 11 

Cost of milk delivered to the city 13 

Trade demands in Detroit 14 



Page. 

Preparing milk for city distribution 16 

Before compulsory pasteurization 16 

After compulsory pasteurization 17 

Capital invested and cost of handling 

milk at city plants 18 

City distribution of milk : 19 

Summary of comparative costs of handling 

and distributing milk 23 

Conclusions 27 



ECONOMIC PHASES OF THE MARKET MILK BUSINESS. 



Preliminary studies by the Department of Agriculture have shown 
the existence of many uneconomical practices in the market milk 
business. These practices have been largely the result of the rapid 
changes that the business has undergone in recent years. Con- 
stantly increasing demands for market milk in the larger cities of 
(his country have resulted in such a rapid increase in the business of 
" middlemen " or dealers that many fundamentally uneconomic mar- 
keting practices have developed and wasteful leaks have been allowed 
to occur daily. In short, efficiency systems have not kept pace with 
the growth and development of the business. 

Note. — This bulletin should be of interest to milk dealers, city and State milk-inspection 
officials, consumers' leagues, producers' organizations, and students of the subject of 
market milk. 

19462°— 18— Bull. 639 1 



2 BULLETIN 639, U. S. DEPARTMENT OF AGRICULTURE. 

In the present study * is presented a general analysis of the market 
milk business as conducted in Detroit, Mich., during the year 1915, 
with a view of indicating some of the fundamental explanations of 
existing market conditions and milk marketing practices in the 
larger American cities. The cost of milk, wages, and many items of 
expense have increased greatly since the data were obtained, and for 
that reason no attempt has been made to show absolute cost and 
profit figures. Some cost analyses are presented, however, in a way 
that will point out fundamental tendencies not dependent upon 
transitory changes in prices and which help to explain some of the 
prevailing market practices. 

The city of Detroit, Mich., was selected for the study primarily 
because in many respects milk marketing methods in that city are 
representative of those in other large cities of the United States. 
Since the pasteurization of market milk had been made compulsory 
by ordinance in Detroit three months before the investigations were 
begun, the selection of that city also permitted a study of the effects 
of compulsory pasteurization upon the number of dealers engaged in 
the business and upon the methods of handling and distributing 
milk. 

MARKET DEMANDS AND SOURCES OF SUPPLY. 

The average quantity of market milk consumed daily in Detroit 
during August, 1915, was approximately 47,569 gallons, and of 
market cream 5,953 gallons. Based upon an estimated population 
of 600,000 this would provide approximately 0.63 of a pint of milk 
and 0.08 of a pint of cream per capita daily. The consumption is 
not uniform throughout the year, however. The shipments of milk 
during May and June were the highest of the year, but the receipts 
were in excess of the city consumption during those months. 

According to the records of one of the largest dealers, the market 
demand for milk in per cent of the yearly consumption is shown 
below by seasons: 

Per cent 
of total. 

Spring 26. 7 

Summer 30. 2 

Fall 20.9 

Winter 22. 2 



100 



It will be noted that the consumption during the summer months 
was one-half higher than during the fall months. 

1 Most of the data upon which this study is hased were collected during September and 
October, 1915. Figures of total quantities of milk handled and general information con- 
cerning the nature of the business of all the dealers were obtained from the records of 
transportation companies and the flies of the milk-inspection department of the Detroit 
board of health. The cost analyses were based upon the records of certain typical dealers. 



MAKKET MILK BUSINESS OF DETBOIT, MICH., IN 1915. 3 

Figure 1 shows the area from which the supply of milk and cream 
was obtained, each dot representing one 10-gallon can of milk or 
cream. The small squares show the location of country milk stations 
where milk was collected, weighed, and cooled before it was trans- 
ported to the city pasteurizing and bottling plants. The figure 



BRANCH\ 




.RAILROADS 

-ELECTRIC LINES 
ONE IO GAL. CAI 
COUNTRY MILK S^ 



p IG . i. — Sources of milk and cream supply of Detroit, and the steam and electric rail- 
ways over which most of it is transported to the city. 

shows that the greater part of Detroit's supply of milk was pro- 
duced within 30 miles of the center of the city. Some shipments of 
cream originated in zones 100 miles distant or more. Because of 
the stringent regulations of the board of health in regard to city 
dairies, the quantity of milk produced within the city was negligible. 



4 BULLETIN 639, U. S. DEPARTMENT OF AGRICULTURE. 

BUYING MILK FROM FARMERS. 

Figure 1 also shows the necessity for middlemen to handle and 
distribute the greater part of the city's supply. Farmers living more 
than 6 or 8 miles from town generally considered it impracticable 
to deliver their milk to the consumers. The quantity of milk pro- 
duced on the average farm in that territory is not sufficient for 
economical market distribution by the farmer. To realize the great- 
est labor income he usually deems it advisable to devote his entire 
attention to farming operations. 

In Table I the milk dealers operating in Detroit during the month 
of August, 1915, are grouped according to the quantity of milk 
handled as well as the quantities supplied to other dealers who did 
not buy from farmers direct. 



Table L- 



-Milk dealers who bought from, farmers during August, 1915, according 
to volume of business. 



Gallons handled daily. 



Less than 150 gallons. . 

150 to 250 gallons 

251 to 500 gallons 

501 to 1,000 gallons 

More than 1,000 gallons 

Total 



Number of 
plants. 



Number of 

gallons 

handled 

daily. 



336 

5,594 

3,960 

3,365 

40, 205 



53,460 



Per cent of 
total city 
supply. 



0.63 
10.46 
7.41 
6.29 
75.21 



100.00 



Number of 
gallons 
sold to 
dealers 
not buy- 
ing from 
farmers. 



569 

915 

1,195 

2,165 



4,844 



Per cent of 
supply 
sold to 
dealers 
not buy- 
ing from 
farmers. 



10.17 
23.11 
35.51 
5.38 



9.06 



Sixty-eight dealers in Detroit bought milk from farmers direct 
and had plants for preparing it for market distribution, either 
through their own or other dealers' equipment. The grouping of the 
dealers in accordance with average quantities of milk handled daily 
shows that the greater portion of the business was handled by com- 
paratively few dealers. 



PRICES PAID TO FARMERS. 

Most of the larger dealers paid for milk on a butterfat basis, while 
the majority of smaller ones bought their milk by weight or measure 
without allowing premiums or making deductions based on butterfat 
content, sediment test, bacterial content, or the score of the dairy 
farm on which it was produced. The larger companies usually 
based their monthly price quotations to farmers upon a butterfat 
test of 3.5 per cent. For each one-tenth of 1 per cent butterfat the 
milk tested below 3.5 per cent the price was reduced 2 cents a hun- 



MARKET MILK BUSINESS OF DETROIT, MICH., IN 1915. 5 

dredweight. For milk testing more than 3.7 per cent a premium of 
2 cents for each one-tenth of 1 per cent butterfat was paid. When 
compared upon a common basis the prices actually paid by the vari- 
ous dealers were found to vary considerably. 

Figure 2 shows the average prices (f. o. b. Detroit) paid by milk 
dealers handling different quantities of milk during 1915, as well as 
the rather wide seasonal variations in prices paid to farmers. A 
fundamental reason for these variations is that at certain seasons 
the quantity of milk supplied by farmers is either above or below 
the city demands, because farmers generally can not regulate their 
daily and seasonal production in accordance with the varying de- 
mands of city consumers. As farmers generally did not utilize the 





Jan Fcb. Mar. A 


*n. M/ 


v Ju 


(915 

NC JU 


LV Al 


G. Sept. Oct. Nov. Dlc. 


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DEALERS OPERATING l-S WAGONS 


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Fig. 



2. — Average prices paid farmers by all milk dealers, grouped according to number 
of delivery wagons operated by each. 



milk produced in excess of the demands for market milk, the dealers 
bought all the milk. That necessitated the manufacture of cheese, 
butter, or condensed milk, which seldom yield as much as market 
milk. Some of the dealers who had no facilities for the economical 
disposal of skim milk actually dumped it into the sewers. 

The prices paid by the larger dealers fluctuated more than those 
paid by the smaller ones. The latter also usually paid the highest 
prices for their milk, which is explained in part by the fact that the 
former obtained their supplies from localities farther from the city, 
where competition for market milk was not so keen, and where in- 
creased costs of transportation tended to reduce the prices paid to 
the farmer as is shown in Table II. 



6 BULLETIN 639, U. S. DEPARTMENT OF AGRICULTURE. 

Table II. — Transportation costs in relation to farmers' prices. 



Shipping station 
number. 


Freight or 
trucking 
cost per 
10-gallon 
can to 
Detroit. 


Farm 

prices per 

10-gallon 

can to 

Detroit. 


Cost to 
dealer 
f. o. b. 
Detroit. 


Shipping station 
number. 


Freight or 
trucking 
cost per 
10-gallon 
canto 
Detroit. 


Farm 

prices per 

10-gallon 

can to 

Detroit. 


Cost to 
dealer 
f. o. b. 
Detroit. 


1 


SO. 15 
.15 
.15 
.175 
.175 
.175 


81.53 
1.49 
1.53 
1.53 
1.42 
1.53 


$1.68 
1.64 
1.68 
1.705 
1.595 
1.705 


7 


$0.20 
.22 
.23 
.24 
.28 
.30 


$1.53 
1.42 
1.42 
1.36 
1.28 
1.23 


$1.73 


2 


8 


1.64 


3 


9 


1.65 


4 


10 


1.60 


5 


11 


1.56 


6 


12 


1.53 









This table shows that although there was a tendency to pay less for 
milk or cream as the distance and cost of transportation increased, 





JAN F 


B Mar A 


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ay J L 


1915 

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158 










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Fig. 3. — Comparisons of average prices paid by Detroit milk dealers with value of the 
milk if the cream had been delivered to local creameries and the skim milk fed to 
live stock on the farm. 

the prices actually paid to farmers depended upon other factors as 
well. In territory where farmers could sell to local creameries or 
cheese factories the prices for milk were influenced by the prevailing 
market prices of butter and cheese. 

Table III and figure 3 show the relation between average prices 
paid by the Detroit milk dealers in 1915 and the average monthly 
wholesale butter quotations in Chicago. The table and figure also 
present the estimated possible returns which farmers might have 
obtained if they had marketed their cream at local cooperative cream- 
eries, whose product is generally sold in accordance with Chicago 
quotations. The estimated returns are based upon the assumption 



MARKET MILK BUSINESS OF DETROIT, MICH., IN 1915. 



that skim milk has a value of 30 cents a hundredweight for feeding 
purposes. Ninety pounds of skim milk were allowed for each 100 
of whole milk. 

Table III. — Average prices, by months, paid for 100 pounds of 3.7 per cent milk 
by all classes of milk dealers in Detroit; also estimated average returns for 
butterfat delivered to a local creamery. 





Average prices paid per hundredweight 
of milk. 


Average 
prices per 
pound for 
butter.' 


Possible returns 
from creameries. 2 


Months. 


Small 
dealers. 


Medium 
dealers. 


Large 
dealers. 


All 

dealers. 


For but- 
terfat per 
hundred- 
weight of 
milk. 


For but- 
terfat plus 

27 cents 
for 90 

pounds of 
skim 
milk. 




$1.91 
1.91 
1.91 
1.68 
1.68 
1.68 
1.795 
1.68 
1.68 
1.91 
1.91 
1.91 


$1,884 


$1,836 
1.823 
1.77 
1.442 
1.180 
1.235 
1.343 
1.523 
1.616 
1.733 
1.780 
1.860 


$1. 876 
1.872 
1.848 
1.60 
1.73 
1.501 
1.585 
1.641 
1.685 
1.831 
1.851 
1.904 


Cents. 

31.7 

30.437 

27.204 

30. 375 

27.46 

27. 175 

25.5 

24.293 

25.016 

27. 156 

30.025 

33.208 


$1,321 
1.264 
1.119 
1.262 
1.130 
1.118 
1.042 
.987 
1.020 
1.117 
1.246 
1.390 


$1. 591 




1 
1 
1 
1 
1 
1 
1 
1 
1 
1 
1 


884 

864 

678 

63 

588 

618 

720 

760 

851 

864 

942 


1.534 




1.389 




1.532 




1.400 




1.388 


July 


1.312 




1.257 




1.290 




1.387 




1.516 




1.660 










1.805 


1.774 


1.595 


1.744 


28.295 


1.168 


1.438 











1 Butter prices are the monthly averages of Chicago quotations on the basis of which most of the creameries 
of that section sell their butter. 

2 These returns are computed on basis of 3.7 per cent butterfat in milk and on the basis of 22 per cent 
overrun in butter manufacture, and a cost of 2.42 cents a pound for manufacture. 

The table and figure also show that there was no constant relation 
between the monthly average wholesale prices of butter in the Chi- 
cago market and monthly average prices paid for milk by Detroit 
dealers. Farmers in that territory generally received higher prices 
for milk than they would have obtained if they had delivered the 
cream to local creameries for the manufacture of butter and had fed 
the skim milk on the farm. Farmers have found that it requires 
great care and expense to produce and deliver daily a good grade of 
market milk, whereas three deliveries a week are usually sufficient 
for buttermaking purposes. 

At certain seasons of the year, however, some of the dealers bought 
milk for less than it would have yielded the farmers if it had been 
utilized in the manufacture of butter and the feeding of live stock, 
which may be explained by the fact that the companies which own 
and control country milk stations may obtain virtual buying monop- 
olies in certain localities. The prices paid to farmers for milk 
usually depend upon existing competition. Small dealers who do 
not own or control country milk stations are generally unable to buy 
milk in distant areas. In the absence of market information and ac- 
tive competition of manufacturing plants it may also be possible to 
buy market milk for less than it would yield for manufacturing 
purposes. 

19462°— 18— Bull. 639 2 



BULLETIN 639, U. S. DEPARTMENT OP AGRICULTURE. 



COLLECTING AND HANDLING MILK IN THE COUNTRY. 



The milk dealers in Detroit obtained their supplies of milk and 
cream either from individual farmers direct or through country 
receiving and cooling stations. The smaller dealers usually gathered 
their supplies near by, mainly because they could not afford the 
investments in country receiving stations, through which the larger 
dealers collect the most of their supplies from the more distant areas 
of production. (See fig. 1 and Table IV.) Most of the supply 
which came from neighboring territory was gathered from farms 
by means of wagons or motor trucks owned by the city dealers. Con- 
siderable quantities of both milk and cream were also shipped directly 
to the city by farmers who lived near railway stations or crossroads 
milk-shipping platforms. There was keen competition for all sup- 
plies of milk or cream directly accessible to the city. 

In order to obtain milk from many farmers who lived too far from 
railroad stations or shipping platforms to make direct shipping prac- 
ticable, it was necessary to establish facilities for collecting milk 
enough at one place to permit more economical transportation to the 
city plant. Farmers generally do not consider it advisable to make 
daily trips for delivering milk when the shipping station is more 
than 5 miles away. An additional advantage of the country receiving 
and cooling stations was that milk could be cooled to the proper tem- 
perature before it was shipped to the city; furthermore, the inspec- 
tion and buying of milk according to quality was expedited. When a 
farmer watches the sampling of his milk and the making of sediment 
and butterfat tests he understands better the justice of paying differ- 
ent prices for different grades of milk. It often happens that dairy 
products can be manufactured more economically in the country 
than in the city, and for that reason the larger milk companies fre- 
quently operate country milk plants, where the surplus not required 
for market milk trade may be converted into other products. 

Table IV shows the quantities of market milk obtained through 
country stations during June, 1915. 

Table IV. — Milk obtained through country stations during June, 1915. 



Number of wagons operated by dealers. 


Number 
of dealers. 


Number 
ofstations 
from 
which 
milk was 
received. 


Number of gallons 
received monthly. 


Per cent 
of total 
shipped 
through 
stations. 


From 
stations. 


From 
farms. 


lto5 


55 
11 
2 






291, 600 
239, 005 
153, 257 




6 to 29 


22 

51 


356, 224 
1, 002, 606 


59.8 


30 to 150 


86.7 






Total 


68 


73 


1,358,830 


683, 862 


66.5 







MARKET MILK BUSINESS OF DETROIT, MICH., IN 1915. 



9 



The total number of gallons handled by different groups of dealers, 
as shown in Tables I and II, does not correspond to the total shown 
in Table IV, because large quantities of milk were bought from 
farmers by those dealers and not used for market milk purposes but 
manufactured into butter, cheese, condensed milk, powdered milk, 
and casein. 

The larger companies obtained the greater part of their supply 
through the country milk stations or "collecting depots," which 
they usually owned. A few of the country stations were owned 
either by farmers' cooperative associations or by individual farmers 
whose dairy houses were equipped to handle truck loads of milk pro- 
duced on neighboring farms. (See PL I, fig. 1.) 

The typical milk-receiving station consisted of a wooden-framed 
building equipped with a small boiler, apparatus for washing and 
sterilizing milk utensils, scales for weighing milk, and a tank for 
holding the cans of milk in ice water until time to ship to the city. 
During the winter natural ice was usually stored in an adjoining 
building for use in the summer. Stations which skimmed or utilized 
surplus milk at certain seasons had additional and more expensive 
equipment, such as receiving tanks, mixing vats, cheese vats, sepa- 
rators, churns, pasteurizers, coolers, and equipment for condensing 
milk. (See PI. I, fig. 2.) 

Table V shows the relation of the amounts invested in 16 country 
milk stations to the number of gallons handled daily. 



Table V. 



-Relation of investment in country stations to nations of milk handled 
daily during June, 1915. 



Station number. 


Gallons of milk han- 
dled daily. 


Investment 
in buildings 

and 
equipment. 


Invest- 
ment per 
gallon 




Cooled. 


Skimmed. 


handled 
daily. 


1 


77 

124 

172 

226 

317 

382 

447 

465 

779 

842 

1,009 

760 

738 

1,907 

1,404 

2,662 




$380.00 

818.00 

440.00 

876.00 

1,325.00 

1,675.00 

609. 00 

1,325. 00 

3, 4.50. 00 

4,553.00 

2, 253. 00 

1,800.00 

1,952.00 

4, 752. 00 

2,053.00 

5, 745. 00 


$4.94 


2 




6.60 


3 




2.59 


4 . 




3.88 


5 




4.18 


6 




4.39 


7 




1.36 


8 .. 




2.85 


9 




4.43 


10 




5.41 


11... 




2.23 


12 


720 
830 


1.22 


13 . % 


1.24 


14 


2.49 


15 


1,155 


.80 


16 


2.16 










769 




2, 125. 00 


3.17 









The investment in the stations does not bear a direct relation to 
(he quantity of milk shipped. Some of the stations were creameries 
or cheese factories which had been converted into receiving stations, 



10 



BULLETIN" 639, U. S. DEPARTMENT OF AGRICULTURE. 



and neither the buildings nor the equipment had been specially pro- 
vided for the milk-station business. In some cases the investment 
was larger than necessary when neither milk skimming nor dairy 
manufacturing was done. Table VI shows the daily expense of 
maintaining and operating the stations included in Table V. 

Table VI. — Average daily expense of collecting and handling milk at country 
stations during June, 1915. 





Gallons handled daily. 


Deprecia- 
tion and 

interest on 
building 

and equip- 
ment. 


Labor and 
supplies 
in plant. 


Route costs 
of collect- 
ing milk. 


Total 

station 

expenses. 


Average 


Station number. 


Cooled. 


Skimmed. 


cost per 

gallon 

handled. 


1 


77 

124 

172 

226 

317 

382 

447 

465 

779 

842 

1,009 

760 

738 

1,907 

1,404 

2,662 




$0.17 

.36 

.20 

.39 

.59 

.74 

.27 

.59 

1.53 

2.02 

1.00 

.80 

.87 

2.11 

.91 

2.55 


$0.90 
.70 
.90 
1.23 
1.60 
1.60 
.97 
2.47 
3.53 
2.87 
2.70 
2.87 
3.53 
3.97 
3.90 
5.63 




$1.07 
1.06 
1.10 
1.62 
2.19 
2.34 
1.24 
3.06 
9.56 
8.09 
3.70 
17.54 
14.48 
10.13 
4.81 
8.18 


$0,013 


2 






.008 


3 






.006 


4 






.007 


5 






.006 


6 






.006 








.002 


8 






.006 


9 




$4.50 
3.20 


.012 


10 




.009 


11 




.003 


12 


720 
830 


13.87 
10.08 
4.05 


.011 


13 


.009 


11 


.005 


15 


1,155 


.001 


16 




.003 










Average 


769 


901 


.94 


2.48 


7.14 


5.64 


.007 



The average cost per gallon of milk for operating the stations 
varied greatly. When surplus quantities of milk and cream were 
manufactured into butter, cheese, etc., at country stations, the operat- 
ing expenses were increased. Some stations, however, show higher 
operating expenses than others, because the cost of collecting the 
milk in the country was included in the statement of expenses. 

COST OF COLLECTING MILK AT COUNTRY STATIONS. 

The prices paid for milk were usually based upon its delivery 
f. o. b. the city plant. The cost of transportation, therefore, must 
be deducted in order to obtain the farmers' actual net returns. In 
order to get sufficiently large supplies at some stations the milk 
dealers had established " milk-collecting routes " for collecting milk 
and cream from farmers living as far away as 10 miles. At 19 
country milk stations there were 843 patrons, of whom 503 had their 
milk delivered by paid route men. 

The farmers' share of the costs of country collecting averaged 12| 
cents a hundredweight and varied from 8 to 18 cents a 10-gallon can. 
In addition to the amount paid by the farmer, the milk dealers were 
sometimes obliged to pay the route men a bonus of from $2 to $3 a 



MARKET MILK BUSINESS OF DETROIT, MICH., IN 1915. 



11 



trip, depending upon the length of the route. The varying costs on 
different routes at a single country station for country collecting are 
shown in Table VII. 

Table VII. — Cost of collecting milk, by routes, June, 1915. 



Number of route. 


Number 

of 
patrons. 


Pounds of 
milk. 


Paid by 
farmers. 


Paid by 
company. 


Average 
total cost 

per 
hundred- 
weight. 


1 


6 

14 
11 
13 
14 
20 
23 
16 
11 

4 


29,113 
41,380 
32,402 
35, 815 
30,242 
67,911 
60,732 
48,544 
43,153 
11,629 


$29. 11 
60.51 
32.40 
46.18 
45.96 

117. 72 
91.09 
76.76 
43.16 
14.09 




$0,100 


2 .. 


$75.00 
32.40 
75.00 
87.50 

117.72 
91.09 
76.76 
60.00 
14.09 


.327 


3 


.199 


4. 


.338 


5 


.441 


6 


.346 


7 


.299 


8 


.316 


9 


.239 


10 


.242 







TRANSPORTATION OF MILK TO THE CITY. 

A large portion of the milk produced within a radius of 20 miles 
of Detroit was " trucked " to the city plants either by team or by au- 
tomobile, but the greater part of the total monthly receipts of milk 
and cream was shipped on either steam or electric railroads. Table 
VIII gives the total quantities of milk and cream (both sweet and 
sour) which were received in Detroit during the month of July, 1915. 

Table VIII. — Quantities of milk received in Detroit during July, 1915. 



Means of transportation. 


Gallons. 


Per cent 
of total. 


Steam roads 


630,990 
637,860 
239,780 


41.8 


Electric roads 


42.3 


Teams or automobile trucks 


15.9 






Total 


1,508,630 1(10. 









The electric lines provided milk cars with side-extension decks 
which permitted two tiers of cans, while the shipments on steam roads 
were handled in ordinary baggage cars. The farmers delivered their 
milk to the shipping stations early in the morning, and most of it 
arrived in Detroit by noon of the same day. Very little milk was in 
transit more than 4 hours. In warm weather it was " precooled " 
either on the farm or at the country milk stations before it was 
shipped, as refrigeration was not provided (except in one instance) 
by the roads. 

Table IX gives a comparison of the milk and cream tariffs (effec- 
tive August 1, 1915) for shipments of 10-gallon cans of milk or cream 
into Detroit on the various transportation lines. 



12 



BULLETIN 639, U. S. DEPARTMENT OF AGRICULTURE. 



Table IX. — Comparison of transportation rates on electric and steam railways 
in the Detroit market milk territory during the year 1915. 



Rates per 

10-gallon 

can. 


Distance, in miles, for which rates apply. 


Detroit 

United 

Railways 

(electric). 


Pere 

Marquette 
Railroad. 


Michigan 

Central 

Railroad. 


Grand 

Trunk 

Railroad. 


$0. IS 
.20 
.21 
.22 
.23 
.24 
.25 
.26 
.27 
.28 
.29 
.30 


1-30 


1-25 
1-25 
26-30 
31-35 
36-40 
41-45 
46-50 
51-60 
61-70 
71-80 
81-90 
91-100 


1-25 
1-25 
26-30 
31-35 
36-40 
41-45 
46-50 
51-60 
61-70 
71-80 
81-90 
91-100 


1-17 
18-55 




31-35 
36-40 
41-45 
46-50 
51-60 
61-70 
71-80 
81-90 
91-100 








56-75 








76-100 



In order to transport bottled milk from a milk-bottling plant 
about 30 miles from Detroit, an insulated milk car on the electric line 
was equipped with brine pipes by means of which the car could be 
refrigerated. Refrigeration was obtained by connecting the brine 
coils under the ceiling of the car with the brine tanks in the country 
milk plant, and while the car was being loaded the cold brine was 
pumped through the coils, thus cooling or refrigerating the car. 
Milk containers made of fiber were used in place of glass bottles. 
(See PL II, fig. 1.) 

The concrete roads which extend into the country surrounding 
Detroit make it possible to haul a considerable portion of the milk 
direct from the farms or country milk stations to the city milk 
plants. Both horse-drawn and motor trucks are used for the pur- 
pose, although, because of their greater speed, the latter are super- 
seding the former, especially on long hauls. 

From a number of country milk stations milk was trucked to the 
city plants by the same men who had charge of the receiving and 
cooling operations. The actual amounts paid by milk dealers to per- 
sons who hauled milk from country stations to the city, by either 
motor or horse truck, were ascertained at several stations. Table X 
presents a comparison of the trucking costs with the transportation 
rates for equal distances by rail. 

Table X. — Costs of trucking milk compared imth rail transportation rates. 





Average 
number 
of cans 
hauled 
daily. 


Distance 
hauled 
(miles). 


Comparative transportation 
costs per can. 


Number of station. 


Trucks. 


Steam 
roads. 


Electric 
roads. 


1 


30.7 
31.6 
46.5 
40.5 
112.5 
49.4 
41.1 
43.7 


12 
-12 
12 
15 

15 
20 
25 
25 


SO. 15 
.15 
.15 
.175 
.175 
.175 
.175 
.175 


$0.20 
.20 
.20 
.20 
.20 
.20 
.20 
.20 


$0.15 


2 


.15 


3... 


.15 


4... 


.15 


5 .. 


.15 


6 


.15 


7... 


.15 


8 


.15 








49.5 


17 


.1656 1 .20 1 .15 











Bui. 639, U. S. Dept. of Agriculture. 



Plate I. 




Fig. 1.— One of the Newer Country Stations where Milk was Received and 
Cooled before being Trucked to the City or to the Railway Shipping 
Point. 




Fig. 2.— A Condensary from which Shipments of Market Milk were Made in 
Such Quantities as were Required from Day to Day. 



Bu!. 639, U. S. Dept. of Agriculture. 



Plate II. 




Fig. 1.— Interior View of a Special Refrigerator Car Used for Transporting 
Milk in Fiber Containers from a Country Milk Plant to Detroit. 




Fig. 2.— A City Pasteurizing and Bottling Plant Handling Approximately 145 
Gallons Daily and Supplying Two Delivery Wagons. 

The total investment in plant and equipment was $4,274, which was an average of $29.48 per 

gallon handled daily. 



Bui. 639, U. S. Dept. of Agriculture. 



Plate III. 




Fig 1 -One of the Largest City Milk Plants, with a Capacity for Handling 
Approximately 15,000 Gallons Daily. 

The average per gallon investment for the group of largest plants in Detroit was approximately S30. 




FIG. 2.-ATTRACTIVE BUT EXPENSIVE EQUIPMENT. 

The disproportionate per gallon investments in equipment between small and large dealers are 
caused iiia nlv bv the well-kept and attractive horses, barns, wagons, and wagon sheds. Such 
Sy in^estmentsf however) together with other advertising expenses, are necessitated by 
competition. 



MARKET MILK BUSINESS OF DETROIT, MICH., IN 1915. 13 

In most cases the cost of trucking was less than the cost of trans- 
portation by steam railroad and the same as by electric road. It 
should be explained that electric lines did not serve those stations 
where costs of trucking were higher than the rates for equal dis- 
tances on the electric railways. 

When the milk was shipped by either steam or electric roads, an 
additional cost of about 1| cents for each 10-gallon can was usually 
incurred in trucking the milk from the city terminal milk platform 
to the city milk plant. 

COST OF MILK DELIVERED TO THE CITY. 

Figure 2 and Table III show the average prices paid by small, 
medium, and large dealers for milk f. o. b. Detroit. As shown in 
Table IV, the smaller dealers did not receive their supplies through 
country milk stations. To show the total cost of milk f . o. b. Detroit 
when received through country stations, and the relation of the costs 
of collecting and handling at these stations, the records of certain 
typical stations were obtained from a few dealers and are presented 
in Table XL 

Table XI. — Relation of daily handling and transportation expenses at country 
plants to prices paid fanners and total cost of milk f. o. b. Detroit during 
June, 1915. 





Paid farmers. 


Costs of collecting and 
handling at country 
station. 


Expenses of 

transporting to 

Detroit. 


Total cost of milk f. o. b. 
Detroit. 


Station number. 


Amount 
per day. 


Net 

price 

per 

gallon. 


Amount 
per day. 


In per 
cent of 
amount 
paid 
farm- 
ers. 


Cost 

per 

gallon. 


Amount 
per day. 


Cost 

per 

gallon. 


Amount 
per day. 


In per 
cent of 
amount 
paid 
farm- 
ers. 


Total 

cost 

per 

gallon. 


1 


$7.00 

12.00 

17.00 

22.00 

30.00 

44.00 

44.00 

54.00 

99.00 

85.00 

108. 00 

83.00 

98.00 

267..00 

141.00 

284.00 


$0,092 
.098 
.099 
.098 
.095 
.116 
.100 
.117 
.128 
.102 
.108 
.115 
.148 
.141 
.114 
.107 


$1.07 
1.06 
1.10 
1.62 
2.19 
2.34 
1.24 
3.06 
9.56 
8.09 
3.70 
17.54 
14.48 
10.13 
4.81 
8.18 


1.5 
8.8 
6.4 
7.3 
7.3 
5.3 
2.8 
5.6 
9.6 
9.5 
3.4* 
21.1 
14.7 
3.7 
3.4 
2.8 


$0. 013 
.008 
.006 
.007 
.006 
.006 
.002 
.006 
.012 
.009 
.003 
.011 
.009 
.005 
.001 
.003 


$1.13 
1.83 

4.73 

3.37 

2.57 

5.70 

6.70 

6.97 

11.67 

23.57 

27.23 

17.47 

16.23 

51.47 

33.67 

71.83 


$0. 014 
.014 
.027 
.014 
.008 
.014 
.014 
.014 
.014 
.027 
.026 
.011 
.010 
.026 
.013 
.026 


$9.20 

14.89 

22. S3 

26.99 

34.76 

52.04 

51.94 

64.03 

120. 23 

116. 66 

138.93 

118. 01 

128.71 

328. 60 

179. 48 

364. 01 


131.3 
124.0 
134.2 
122.6 
115.8 
118.2 
118.0 
118.5 
121.4 
137.2 
128. 6 
142.1 
131.3 
123. 
127.2 
128.1 


$0. 119 


2 


.120 


3 


.132 


4 


.119 


,5 


.109 


6 


.136 


7 


.116 


8 


.137 


9 


.154 


10 


.138 


11 


.137 


12 


.137 


J3 


.167 


14 


.172 


1.5 


.128 


16 


.136 


Average... 


87.00 


.113 


5.63 


7.0 


.006 


17.88 


.017 


110. 70 


126.3 


.134 



The "'net prices" paid farmers at different stations during the 
month of June, 1915, varied from 9.2 cents to 14.8 cents a gallon. 
These prices are not the same as those quoted in the schedule of prices 
for milk delivered f. o. b. Detroit, but are what the farmers actually 
received at the particular stations after transportation costs had been 



14 



BULLETIN 639, U. S. DEPARTMENT OF AGRICULTURE. 



deducted. The average costs of collecting, handling, and transport- 
ing to city amount to approximately 25 per cent of the net price paid 
to the farmers. The last column of the table shows that the cost of 
milk delivered in Detroit varied considerably, depending upon where 
it was bought and the varying costs of collecting, handling at sta- 
tions, and transportation to the city. The dealers paid varying 
prices in different communities, in accordance with the local competi- 
tive conditions and the city demands for market milk. There' was 
no fundamental cost basis for the prices which then prevailed in the 
Detroit territory. (See also Table II and fig. 2.) 

TRADE DEMANDS IN DETROIT. 

The business of milk dealers usually consisted of a combination of 
wholesale and retail trade. The wholesale trade required milk and 
cream in both cans and bottles; hotels, restaurants, ice-cream manu- 
facturers, and bakeries generally purchased bulk goods, while hospi- 
tals, sanitariums, saloons, and soda fountains required both bulk and 
bottled goods. Retail stores also bought bottled goods at wholesale 
prices. Prices paid by that class of trade varied greatly, depending 
largely upon the grade and quantity purchased, as well as upon 
changing market conditions. Wholesale prices for common milk 
generally fluctuated around 22 cents a gallon in bulk and 7 cent's a 
quart in bottles. 

The retail trade of milk dealers consisted of sales to families and 
(for luncheon) to office and factory workers. The retail price for 
common milk in Detroit during June, July, and August, 1915 (the 
time covered by this study) was about 8 cents a quart. 

Table XII shows the variation of demand on retail milk routes. 

Table XII. — Variable demands of retail customers for milk, cream, and other 
milk products, by different retail routes. 





Common milk- 


Certified and 
special. 


Cream. 


Butter- 
milk. 


Average 
daily sales. 


CD 

C3 

'3 


CD 

2 
"3 



a 

CD 


Number of 
customers 
on route. 


o 
,0 

1 


3 
5 

3 to 

«! 

CD 

M 

cd 

Ph 


.1 

a 


1* 

& 

a 

a 

22 

236 

130 
215 
188 
207 
239 
252 
251 
250 
70 


3 

u 
O to 

aB 
8 © 

(1 

CD 

Ph 


u 
3 

I 



o> 
A 


3 
a 

3 to 

cd 

O-w 

u 


Ph 


.3 

a 

"o 
|Z5 


3 


•3 JO 
CD 

«I 

cd Q 

M 

O 

Ph 


.a 
a 


u 

CD 


3 



•3 to 
CD 

«! 

CD 

It 

CD 

Ph 


"3 

A 
O to 

£ ft 


3 


3 to 

CD 

«! 

S-2 

H 

cd 

Ph 


u 
cd 

^co" 

2.1 

8 ft 


3 


3 CO 



«! 

n 

CD 

Ph 


1 
O 

,2 

a 
3 


3 


3 to 
CD 

11 

t-. 
CQ 

Ph 



1 

H 

u 

CD 


CD 

a 
3 

I 

h 

CD 

Ph 


ft 

•t* *■< 

CD P 

CD 

be 

a 

u 

< 


351 


122 
92 
156 
109 
130 
129 
134 
183 
157 
70 


34.7 
42.9 
45.4 
39.9 
40.7 
36.2 
39.8 
53.1 
45.9 
56.0 


67.2 
60.7 
62.6 
68.8 
64.8 
67.1 
75.0 
72.9 
73.0 
56.0 


3 
5 

4 
3 

8 


0.8 
2.3 
1.1 
1.0 
2.5 


4 


1.1 


3 


0.8 


34 
7 
43 
30 
28 
51 
12 
8 
33 
20 


9.6 
3.2 

12.5 

10.9 
8.7 

14.3 
3.5 
2.3 
9.6 

16.0 


24 
12 
25 
35 
28 
57 
1 
4 
25 
12 


6.8 
5.6 
7.2 

12.8 
8.7 

16.0 
.2" 
1.1 
7.3 
9.6 


4 
2 

8 

10 
10 
6 
13 
10 
6 
7 


1.1 

.9 

2.3 
3.6 
3.1 
1.6 
3.8 
2.9 
1.7 
5.6 


$24.44 
14.50 
27.70 
22.22 
24.02 
26.54 
22.61 
26.54 
28.62 
11.83 


$0,069 
.067 
.080 
.081 
.075 
.074 
.067 
.077 
.083 
.093 


$247. 00 
183.00 
409.00 
261.00 
339.00 
351.00 
234.00 
321.00 
440.00 
176.00 


$0. 703 


214... 


.855 


343 


5 

4 
2 


1.4 
1.4 

.6 


4 
5 


1.1 
1.8 


1.192 


273 


.956 


319 


1.062 


356 






.985 


336 


1 

1 

10 

2 


.2 

.2 

2.9 

1.6 










.696 


344 


4 
2 
2 


1.1 
.5 

1.6 


2 
3 


.5 
2.4 


.933 


342 


1.286 


125 


1.408 






Aveiage,300. 


128 


42.6 


204 


68.0 


3.7 


1.2 


2.3 


.7 


1.7 


.5 


26.6 


8.8 


22.3 


7.4 


7.6 


2.5 


22.90 


.076 


296.00 


.986 



MARKET MILK BUSINESS OF DETROIT, MICH., IN 1915. 



15 



The table shows also that the milk dealers of Detroit handled a 
variety of goods in various-sized containers, some of which were 
demanded by relatively few customers. This custom has developed 
because it was found advisable to supply the exact quantities in the 
kind and size of containers demanded. To increase the demand for 



iS<S/V£/3/S 



K 3.8 

%3.e 



^3.0 
%2.8 

% 2* 
$2.2 
\2.0 













































































































t 














































t 
















i 








/ 


















/ 


\ 
\ 
















i 
i 


\ 






r 
i 






> 








/ 










' 






/ 






i 










. / 


i\ 




\/ 






i 








\ 








; 










/ 


\ 


> 








a 










/ 






A 






i 












/ 


— 








*"■ 


s -^ 




\/ 


i 
















y 








\ 
\ 




/ 












-... 


/ 
















A 










V 


-_ 




r 










i 


j. 


t 




















- 

















































































































































































































































3* 

3.2 >H«= 



■ M/iy /pscf/prs //v />£/? c£av osft/wir /?£C£/y£0 £w?/a/g r#£/vossr// 

-0/9/trS/1^//Vfif#C£ArOfS/)£fSO£/y/LrM/?//VGr/Y£/7O/Vr// 



Fig. 4. — Daily fluctuation in receipts and sales of milk in per cent of total supply and 

sales for the month. 

some special goods certain dealers often advertise them extensively, 

because it also tends to increase the sales of common milk and cream. 

The fluctuating daily demands in relation to the monthly sales of 

market milk are illustrated by figure 4. The daily sales of market 

Route: 
Numbers —* \ 2 3 * s g 7 8 9 io ii 12 o ia- 



01 

^200 

Q 
£100 

<t 

hi 

<t> 











































/ 


\ 




/ 


^ 






/ 


\ 

\ 






$100 




/ 

/ 

/ 






/ 


\ 


V 

\ 


/ 

* 


\ 










\ 
\ 








/ 

/ 




s' 




\ 




^' 


— 


\ 


,*• 






A 








^ 


-'" 








s' 
















25 






!x' 


~"-'~ 


-^' 


• 


^ 


••. > „ 


*^. •* 










^ 






































=- 



Pints or Milk 

Quarts or Milk 

••• '/b Pints ar Cream 



-Value, or Route Sales 
-Quarts or Buttermilk 
•Gills of Cream 



Fig. 5. — Chart showing one day's sales on 14 retail routes serving approximately an 
equal number of customers. 

milk are shown in per cent of the total sales for the month. In 
order to furnish the exact quantities of goods that might be required 
by the trade at any time and hold the business, it was necessary for 
milk dealers to have on hand a sufficient quantity of goods to supply 
all probable demands. To avoid excessive losses from surplus 



1G 



BULLETIN 639, U. S. DEPARTMENT OP AGRICULTURE. 




Fig. 6. — Location of city milk plants in Detroit before compulsory pasteurization. 

quantities which were not needed by the trade, dealers utilized the 
surplus by manufacturing it into some less perishable product, such 
as butter, cheese, or condensed milk. 

The various demands of consumers for goods put up in different- 
sized containers are graphically illustrated in figure 5. Although 
there were approximately an equal number of customers on each of 
the 14 routes, and though the value of sales was approximately the 
same, the demands for goods in different-sized containers varied 
greatly. To supply the demands for market milk and its deriva- 
tives it was necessary for dealers to equip their plants properly for 
distributing in the city the milk received from various producers in 
the country. 



PREPARING MILK FOR CITY DISTRIBUTION. 

BEFORE COMPULSORY PASTEURIZATION. 

Prior to the enforcement of the milk-pasteurization ordinance 
there were 158 milk dealers in Detroit, and the " plants " were situ- 
ated in different parts of the city, as shown in figure 6. Twenty-four 
dealers used the " flash " method of pasteurization and 19 the " hold- 
ing" process. There were 91 dealers who bottled raw milk, each 



MARKET MILK BUSINESS OF DETROIT, MICH., IN 1915. 17 




Fig. 7. — System of city distribution of market milk in Detroit after compulsory 

pasteurization. 

handling from 40 to 1,500 gallons daily. Only a few of the smaller 
plants were equipped with steam boilers, the greater portion using 
gas heaters to furnish hot water for washing the milk bottles and 
utensils. Forty-four dealers purchased pasteurized milk in bulk 
from 23 other dealers, which they bottled and sold to both retail and 
wholesale trade. 

The records of the Detroit Board of Health showed higher bacterial 
counts in milk pasteurized by the flash method than that pasteurized 
by the holding method. The pasteurized milk which was purchased 
from other dealers often showed higher bacterial counts than the 
samples of the raw milk before pasteurization. The bacterial counts 
were usually higher in the pasteurized milk purchased from other 
dealers for bottling than in that which was pasteurized and bottled in 
the same plant. 

AFTER COMPULSORY PASTEURIZATION. 

The pasteurization ordinance which became effective May 1, 1915, 
required that all milk be pasteurized by the holding process in plants 
equipped in accordance with regulations adopted by the milk- 
inspection department of the city board of health. 



18 



BULLETIN 639, U. S. DEPARTMENT OF AGRICULTURE. 



August 1, 1915, three months after the pasteurization ordinance 
became effective, there were 68 plants in which milk was prepared for 
market distribution. Approximately 75 per cent of the total milk 
supply was pasteurized by 11 dealers whose average daily output per 
plant was more than 3,600 gallons. About 10 per cent of the city's 
milk supply was distributed by small dealers who purchased their 
supplies from other dealers who operated pasteurizing plants. (See 
fig. 7.) 

CAPITAL INVESTED AND COST OF HANDLING MILK AT CITY PLANTS. 

To show the investments required for milk plants and equipment, 
and the varying costs of handling milk in preparing it for distribu- 
tion in the city, the records of 28 representative dealers were obtained. 
Table XIII shows the varying investments in relation to the operat- 
ing costs in the plants, according to increasing costs of handling. 

Table XIII. — Relation of cost of handling to capital investments, supplies, and 
labor in twenty-eight city milk plants. 



Handling 


Gallons 


Investments. 


Suppl 


ies. 2 


Labor. 














cost per 
gallon, i 


handled 
daily. 


Total. 


Per gallon 

handled 

daily. 


Per day. 


Per 

gallon. 


Per day. 


Per 
gallon. 


Cents. 










Cents. 




Cents. 


2.3 


1,600 


$13, 300 


$8. 31 


14.96 


0.9 


S13. 68 


0.9 


2.4 


350 


4,320 


12.34 


11.84 


1.2 


1.99 


.6 


2.6 


9,706 


267, 575 


27.57 


70.01 


.7 


167. 82 


1.7 


2.6 


2,000 


16, 824 


8.41 


16.57 


.8 


27.21 


1.4 


2.7 


850 


7,-154 


9.54 


5.48 


.7 


10.68 


1.4 


2.8 


1,450 


41,643 


28.72 


9.76 


.7 


14.25 


1.0 


3.1 


1,450 


18, 720 


12.90 


18.42 


1.3 


17.03 


1.2 


3.3 


220 


1,917 


8.71 


2.45 


1.1 


3. 81 


1.7 


3.3 


340 


3,502 


10.30 


3.24 


1.0 


5.98 


1.8 


3.4 


470 


2,527 


5.38 


4.87 


1.0 


9.86 


2.1 


3.6 


400 


5,312 


13.28 


4.20 


1.0 


7.40 


1.9 


3.7 


165 


3,029 


18.36 


1.95 


1.2 


2.71 


1.6 


3.8 


2,119 


97, 457 


45.99 


11.79 


.6 


47.31 


2.2 


3.9 


425 


7,595 


17.87 


5.61 


1.3 


7.12 


1.7 


4.4 


335 


4,542 


13.56 


5.43 


1.6 


5.98 


1.8 


4.4 


100 


1,186 


11.87 


1.64 


1.6- 


2.00 


2.0 


4.5 


310 


3,847 


12.41 


5.18 


1.7 


5.84 


1.9 


5.2 


230 


4,927 


21.42 


2.35 


1.0 


7.13 


3.1 


5.2 


1,300 


7, 315 


5.63 


36.10 


2.8 


9.97 


.8 


5.3 


100 


1,829 


18.29 


1.18 


1.2 


2.99 


3.0 


5.4 


240 


7,141 


29.75 


3.70 


1.5 


6.04 


2.5 


5.4 


530 


20,251 


38.21 


6.76 


1.3 


10.54 


1.0 


6.1 


135 


1,829 


13.55 


1.57 


1.2 


5.60 


4.1 


6.8 


85 


2,705 


31.82 


1.24 


1.5 


3.00 


3.5 


6.8 


1,260 


110,592 


87.77 


33.78 


2.7 


21.80 


1.7 


7.0 


145 


4,274 


29.48 


3.58 


2.5 


4.70 


3.2 


7.1 


90 


2,762 


30.69 


2.18 


2.4 


2.56 


2.8 


7.2 


40 


1,725 


43. 13 


.51 


1.3 


150 


3.8 


Ave. 4.4 


940.9 


23,778 


21.97 


10.23 


1.4 


15.23 


2.01 



1 These unit costs include charges for depreciation and interest on capital invested, supplies, and labor 
expenses (all the items which could be definitelv charged against handling in plant). 

2 Supplies include charges for fuel, ice, power and light, bottles, caps, washing powder, brushes, etc. 

A study of the table reveals rather wide variations in the costs of 
handling milk in the different plants, many of which are caused by 
the varying proportions of bottled and bulk milk handled. The 



MARKET MILK BUSINESS OF DETROIT, MICH., IN 1915. 



19 



average costs per gallon handled at the different plants, therefore, 
are not exactly comparable, for it does not cost so much to pasteurize 
and put into cans the milk sold to other dealers or to wholesale trade 
as it does to pasteurize and bottle milk for the retail trade. 

It is important t© note the disproportionate investments in milk 
plants and equipment. The investments per gallon handled daily 
range all the way from $5.38 to $87.77, and illustrate the lack of 
standardization of milk plants and equipment. It is obvious that a 
relatively low investment greatly reduces the interest and deprecia- 
tion charges against each gallon handled. In those plants where the 
operating costs per unit were the lowest, the investments per gallon 
were generally comparatively small and the expenditures for sup- 
plies and labor in proportion to capital invested were. greater. (See 
PI. II, fig. 2, and PI. Ill, fig. 1.) 

Some of the disproportionate investments may be accounted for by 
the fact that some plants were old and handled a large proportion of 
bulk milk, whereas others were newly built for the purpose of in- 
creasing the business. 

CITY DISTRIBUTION OF MILK. 

The number of milk dealers engaged in the business of distributing 
milk in Detroit, August 1, 1915, and the size of the business of those 
dealers grouped according to number of delivery wagons operated, 
are shown in Table XIV. 



Table XIV. — Quantity of milk and cream distributed daily by dealers (grouped 
according to number of wagotis operated). 





Number 

of 
dealers. 


Total 
number 

of 
wagons. 


Average 
number 
of wag- 
ons per 
dealer. 


Gallons sold daily. 


Per cent 
of total. 


Number of wagons. 


Milk. 


Cream. 


Ito5 


127 
7 
4 
2 


201 
80 
70 

235 


1.5 
11.4 
17.5 
117.5 


15, 179 
8,340 
6,050 

18,000 


271 

367 

215 

5,100 


28.8 


6 to 15 


16.3 


16 to 30 


11.7 


31 to 150 


43.2 







On August 1, 1915, there were 140 milk distributors, or 18 fewer 
than on May 1, when the pasteurizing ordinance became effective. 
Of these dealers 127 operated from 1 to 5 wagons each. Two of the 
larger companies, operating more than 30 delivery wagons each, 
together distributed nearly 44 per cent of the total milk supply of 
the city. 

Figure 7 is a graphic presentation of the system of distribution 
which prevailed in August, 1915. The locations of the milk-pasteur- 
izing and bottling plants are indicated by squares. The areas of the 
squares represent the relative quantities of milk pasteurized in the 



20 



BULLETIN 639, U. S. DEPARTMENT OF AGRICULTURE. 



plants. The small circles indicate the location of the different dealers 
in the city. The number of radii within the circle represents the 
number of delivery routes operated by each dealer. When a dealer 
purchased his supply from a pasteurizing and bottling plant, a broken 
line shows his connection with the plant from which the supply was 
obtained. A comparison of the map with figure 6, which presents 
conditions on May 1, 1915, shows that the number of city milk plants 
was reduced on August 1, but that the number of milk dealers had 
not decreased greatly. 

In addition to the dealers referred to in figure 7 there were two 
dealers who operated plants in the country where milk was pasteur- 
ized, bottled, and shipped to Detroit. By selling to hotels, restau- 
rants, and factories it was possible for one of the suburban plants to 
sell practically its entire supply at wholesale. The other plant bot- 
tled a considerable portion of its supply in the country, and either 
shipped the remainder in bulk to the city or manufactured it into 
cheese. This plant used fiber containers instead of glass bottles for 
goods sold in retail quantities. Instead of delivering direct to con- 
sumers, which would have required an investment in retail delivery 
equipment and the maintenance of a city sales organization, arrange- 
ments were made with grocery stores to retail the milk. There were 
some objections to the use of fiber containers, but storekeepers gen- 
erally accepted them, because no losses were incurred by the failure 
of customers to return the empty bottles. The use of these containers 
was very successful for that class of trade. 

Table XV shows the proportion of retail and wholesale trade of 
dealers handling different quantities of milk. 



Table XV. — Relation of retail to wholesale business. 





Average 
number 


Quarts sold daily. 


Per cent sold. 


Number of wagons. 


of wag- 
ons per 
dealer. 


Retail. 


Whole- 
sale. 


Retail. 


Whole- 
sale. 


1 to 5 


1.5 

11.4 

17.5 

117.5 


34, 752 

20, 700 
12, 900 
45, 600 


25,964 
12, 660 
11,300 
20, 400 


57.2 
62.0 
53.3 
63.3 


42.8 


6 to 15 


38.0 


16 to 30 


46.7 


31 to 150 


36.7 







Different dealers had various proportions of wholesale and retail 
business, and there was no definite relation between the quantity of 
milk handled and the proportion of wholesale to retail sales. 

The relation of the size of a dealer's business to the daily variation 
in quantities of market milk sold at wholesale and retail is shown in 
figure 8. While the records of both the larger and smaller dealers 
showed considerable variation in their total daily sales, the sales of 



MARKET MILK BUSINESS OF DETROIT, MICH., IN 1915. 



21 



the larger companies fluctuated less than those of the smaller ones, 
possibly because their ownership of country stations enabled them 
to provide an ample supply and better facilities for utilizing any sur- 
plus. The smaller concerns, because of the comparatively small 
quantities handled, usually found the manufacture of by-products to 
be less profitable than the selling of a temporary surplus to whole- 
sale trade even at greatly reduced prices. 

The small dealers usually made both wholesale and retail deliveries 
from the same wagon, while the larger dealers generally operated 
their wholesale routes separately. Because of the irregular and ex- 
acting service required by the wholesale trade, a large part of the 
sales to that class of trade is often made by special delivery trucks. 
Figure 8 gives a graphic presentation of the comparative amounts 
of wholesale business of large dealers handled by special delivery. 

Table XVI shows the investment required for delivery equipment 
in relation to the cost of delivering milk from city plants to the 
various classes of trade. 



Table XVI. — Relation of costs per quart delivered to investments in delivery 
equipment, average number of quarts delivered per wagon, and per cent of 
sales at retail for 28 dealers. 





Investments in deliv- 










ery equipment. 




Average 




Cost per 




Number 
of deliv- 


quarts 
delivered 


Per cent 
of sales 
at retail. 






quart. 1 


Total. 


Per 

gallon 
delivered 


ery 
wagons. 


per 
wagon 
daily. 






daily. 








Cents. 












0.5 


81,005.00 


83.24 


1 


1,240 


0.0 


.8 


956.00 


4.35 


3 


293 


77.3 


.9 " 


1,527.00 


9.25 


1 


660 


50.0 


1.1 


14,899.10 


8.92 


14 


477 


54.5 


1.2 


527.50 


4.06 


2 


260 


73.1 


1.2 


7,280.00 


6.31 


12 


384 


62.5 


1.2 


2,480.00 


6.12 


4 


405 


47.1 


1.2 


8,773.00 


6.05 


14 


414 


93.3. 


1.2 


870.00 


8.70 


1 


400 


77.2 


1.3 


2, 907. 00 


12.11 


3 


320 


60.0 


1.3 


1,180.00 


8.74 


1 


540 


77.3 


1.3 


40,050.85 


18.90 


14 


605 


58.9 


1.4 


170,090.04 


17.52 


99 


392 


" 81.3 


1.4 


15,055.50 


9.45 


16 


400 


53.3 


1.4 


692.00 


8.14 


1 


340 


62.5 


1.4 


2,096.00 


6.45 


3 


433 


76.9 


1.4 


8, 779. 00 


6.86 


14 


366 


34.5 


1.5 


3,030.00 


10.10 


4 


300 


65.0 


1.5 


1,160.00 


4.04 


5 


200 


50.0 


1.5 


1; 595. 50 


6.94 


3 


307 


73.8 


1.5 


575.00 


14.38 


1 


160 


85.0 


1.6 


1,570.00 


17.44 


2 


180 


61.5 


1.6 


2,740.00 


8.06 


4 


340 


74.5 


1.6 


7,375.00 


17.35 


4 


425 


65.0 


1.7 


785.50 


7.85 


2 


200 


64.3 


1.7 


2, 623. 33 


7.83 


3 


447 


71.4 


1.8 


2,831.50 


5.34 


6 


353 


80.0 


2.5 


29,225.35 


23.19 


20 


252 


56.9 


2 1.38 


211,881.75 


2 9.58 


29 


2 396 


2 63.9 



These unit costs do not include items of administration, office expenses, advertising, licenses, insurance 
taxes, and other miscellaneous expenses. 
2 Average. 



22 BULLETIN 639, U. S. DEPARTMENT OF AGRICULTURE. 

Table XVI shows that the cost of delivering a quart of milk in the 
city is dependent upon many things besides the average number of 
quarts delivered daily by each delivery wagon. The most economical 
delivery was effected by a dealer who sold bottled milk exclusively, 
but delivered in relatively large quantities to retail stores only. The 
dealer whose delivery cost per quart was the highest had comparatively 
small average sales per wagon in relation to the proportion of sales 
made to wholesale trade. The figures suggest possible economies in 
milk distribution if all sales were made through the medium of 
established retail stores. The table, however, does not indicate the 
cost of delivering to the consumer by the retail stores. 

The item "investments in delivery equipment" includes horses, 
barns, wagon sheds, automobile trucks, delivery wagons, and sundry 
articles used in delivering milk. The reasons for the wide variations 

weeKLy b us/ness ofaobale/? ope#at/a/g oi/e/? oa/e /lUA/offED hmgoms. 

St/WCWV | B 

Afcwctfy | B ~ 

7Z/£SOAy | B 

Mao/uEsafy^l B 

THUftSDAy | B 

/^/zwd B 

s*T(//?a/iyT^ B 




rvrexLy bus/mess op a 'obxlb/? op£/?at/mg i.£ss m/w P/rrEEw wigo/v$. 
st//voAy\ 

AX>/V£My\ 
7V£S0Ay\ 
tVECWESCMY^ a, _J AMOUSSTtSOLO 

m/a^y BBHIHCZZZZZZZI] ww^ssv^f 

HBiBHH I sp£c/su.aroy&? 

Fig. 8. — Relation of size of business to fluctuations in daily sales at wholesale and retail. 

in delivery investments per gallon delivered are the varying propor- 
tions sold at wholesale, and the fact that some of the larger dealers 
had unusually high-priced horses and very costly stables. Such un- 
usually large investments in delivery equipment are maintained for 
advertising as well as for direct utility. (PI. Ill, fig. 2.) 

Figure 9 illustrates the cost of city delivery in relation to amount 
of sales on 14 city delivery routes. Eoutes Nos. 1, 7, and 9 were en- 
gaged in a strictly wholesale delivery of bottled milk to retail stores, 
restaurants, and hotels. The business on the other routes consisted 
mainly of retail delivery at the family door, with only a few de- 
liveries to grocery stores. 

The heavy line in the figure shows the variation in the value of 
daily sales on the routes. Pasteurizing and bottling expenses at the 
city plant are included in the item " cost of goods." The item " cost 



MARKET MILK BUSINESS OF DETROIT, MICH., IN 1915. 23 



of goods and selling expenses" does not include overhead charges 
for taxes, administrative expenses, or losses occasioned by breakage 
or spoilage of goods on routes. The chart is designed to show the 
profit from business on different sales routes. Some routes show a 
good margin of profit, while others are run at an actual loss. The 
dealer who would expand his business under existing competition 
often finds it advisable to build up new routes at the expense of other 
routes which are profitable. Such expenses are the inevitable results 
of any competitive system of distribution. Figure 9, like Table XVI, 
suggests that considerable savings in delivery costs can be effected 
through a more centralized distributing organization. 



Route 
Numbers 



1000 



12 13 14- 



900 



800 



to 

UJ 

£700 

Q 

CQ GOO 

° 500 

uj 

^ 400 

^ 300 



200 



100 













































1 




! 
















V 










1 


\ 


1 
1 


\ 

\ 














\ 
\ 










1 


\ 


1 

1 


\ 














\ 

\ 










1 
i 
i 


\ 


1 


\ 














\ 


\ 








1 


\ 


1 


\ 


/ 














\ 




y 






\ \ 
\\ l 


1 t 
J I 




/ 


\ 




h 








\ \ 


^ 


y 




/ / 


A\ 


III 






\ 




// 
II 






\ 


\\ 






'/^ 


,' 


\^A 


/' 


\\ 








// 








N \ 


r ^ z 


---" 






v 


/ 
f 


\ 


^ 


A 


s 


V / 




























"" 







#100^ 

Q 

90 ft 



70 



GO 



SO 



Fig. 9.- 



A-0 Q 

"C 

30 io 

Q 

20 Q 
CO 

10 ^ 

to 

O 

Number of Bottles to 

Receipts or Value of Goods 

Cost of Goods and Selli-ng Expenses 

Cost of Goods 

-Average number of bottles delivered and value of sales in relation to cost of 
goods and expenses of delivery on 14 selected routes. 



SUMMARY OF COMPARATIVE COSTS OF HANDLING AND DIS- 
TRIBUTING MILK. 

In the foregoing tables and figures only such expenses were in- 
cluded as might be definitely allocated or fairly apportioned to either 
the expenses of handling milk in plants or of delivering in the city. 
Miscellaneous expenses, insurance, taxes, and charges for advertising, 
administrative, and office expenses were not included in any tables 
or graphs. In order to bring out some of the comparative advantages 
and disadvantages of small and large businesses, these items of ex- 
pense are included in Table XVII, which shows the average per 
gallon investments and expenses of 28 dealers grouped according to 
the number of gallons handled daily. 



24 



BULLETIN 639, U. S. DEPARTMENT OF AGRICULTURE. 



Table XVII. — Comparative investments and costs per gallon of handling and 
distributing milk by 28 dealers grouped according to quantities handled. 



Dealers grouped 
















CO 






according to 
















g 






number of gal- 


For handlim 




For delivery. 


For administration. 




+» 






lons handled 
















•d 


o 




daily. 
















5 
8 


s 

ft 

eg 

3 




1 

o 


ft 


















3.b 


« 

ft 
a> 

-a . 

■eg 






OT 

3 


3 . 

s 


o 
So 


t-T3 

s 


® 
Tip 






U.T3 

ftTj 


9 






"-is 

CO 






I 


■1 


o 
o 

a 

03 


CS 


■si 

3 
ft* 


o 


0=3 

S3 
■gJS 




.2 


u 


Ct3 


fl.H 


.8 




§3 

IS 


fi.2 


.2 


op 


o 


9 

§ 


8 

1 
o 


03 
O 


1 


> 
< 


g el 


s 
a 


ft 

3 
CO 


■§ 






ft 
ft 

02 


o 

■s 

■J 


p 


CD 


ft 
ft 

s 

M 


"3 

GO 


o 


O 


03 
O 


Less than 


Galls 




a*. 


as. 


Os. 




a.?. 


as. 


a*. 


as. 


as. 


Cte. 


as. 


a*, 


as 


as 


as. 


150 


99 


$23,725 


1.2 


1.7 


3.20 


$9. 117 


0.48 


1.08 


3. 36 






0.10 


0.5 




0.10 




11.72 


151 to 500. 


315 


13. 870 


.6 


1.3 


1.8 


8.348 


.38 


.91 


2.94 


0.489 


0.02 


.09 


.73 




.08 




8.85 


501 to 




































1,000.... 


640 


21.535 


1.0 


1.0 


1.7 


6.404 


.39 


.85 


3.50 


.165 


.007 


.10 


1.30 




.04 




9.90 


1,001 to 




































1,500.... 


1,365 


32. 485 


1.2 


1.8 


1.2 


10.039 


.54 


1.01 


3.46 


.516 


.02 


.02 


.90 




.04 


.01 


10.20 


1,501 to 




































2,000.... 


1,800 


8.395 


.4 


.9 


1.1 


9.160 


.61 


.83 


2.54 


.183 


.01 


.10 


.70 




.05 


.03 


7.30 


2,001 to 




































3,000.... 


2, 119 


45. 625 


1.0 


.6 


2.2 


18.980 


.43 


.92 


3.69 


.730 


.04 


.40 


.70 


.30 


.20 


.06 


10.50 


More than 




































3,000.... 


9,706 


27. 375 


.2 


.7 


1.7 


17. 520 


.21 


1.29 


4.01 


6.570 


.29 


.25 


.43 


.05 


.20 




9.30 


Average 


































of all 




































groups.. 


2,292 


24.715 


.8 


1.142 


1.842 


11. 3666 


.43 


.98 


3.36 


1.236 


.0645 


.151 


.751 


.175 


.091 


.003 


9.819 



1 See note below Table XIII, page 18. 

2 Supplies for delivery include charges for horse feed and shoeing, lanterns, automobile 
supplies, milk carriers, etc. 

3 Investment for administration include office furniture and appliances. 

4 Supplies for administration include office supplies, such as route books, accounting 
forms and books, tickets, stationery, electric lights, etc. 

6 Salaries for administration include salaries of office clerks and administrative officers. 
In some plants only a part of a man's salary was charged to the item, as some of the time 
was charged directly to labor for either handling or delivery. 

Table XVII and figure 10 show that on the average the cost of 
handling milk is less in the larger-sized plants than in the smaller 
ones. The groups handling daily from 1,001 to 1,500 gallons and 



COST Of* /64A/DL/A/G /4A/0 O/S77?/0(/T/OA/ 

■fc Vl ?> M 0) <0 $ 




/SO/WDl£SS $ f> 



SO/-ZOOO 
/00/-/500 0) i 

Is 

/so/-.eooo b S 

is 

S00/-3000 K N 
O^se 3QOO X 



Fio. 10. — Cost of handling and distributing a gallon of milk. 



MARKET MILK BUSINESS OF DETROIT, MICH., IN 1915. 



25 










o 





Ov 


<b 






S 


o 


Q 


<S 




$ 


V 


ft 


* 


N 







*> 


§ 


5 






from 2,001 to 3,000 gallons do not conform strictly to the general 
tendency, because the plants in these groups had large investments 
in buildings and equipment, and were not operated at full capacity 
in all cases. The delivery costs per gallon do not vary in accord- 
ance with the size of the business; the reasons are indicated in 
Table XVI and figure 9. 

Figure 11 shows graphically the differences in per gallon in- 
vestments by dealers, 
grouped according to 
number of gallons 
handled daily. The ex- 
tremely disproportion- 
ate investments for 
both handling and de- 
livering are explained 
in the discussion fol- 
lowing Tables XIII 
and XVI. The general 
tendency, however, was 
for the handling in- 
vestment to increase 
with the size of the 
plant to the point of a 
plant handling as high 
as 2,001 to 3,000 gal- 
lons. The group han- 
dling 1,501 to 2,000 gal- 
lons has a dispropor- 
tionately low invest- 
ment because in that 
group the dealers had 
equipped some old 
wooden buildings for 
temporary use until 
thoroughly modern 
plants could be con- 
structed and satisfac- FlG - n 
torily equipped. Plants 
handling less than 150 gallons present another exception to the gen- 
eral tendency which in part can be explained by the fact that they 
were not operated at full capacity. The figures would also indicate 
that unless a dealer can handle at least 150 gallons his plant invest- 
ment charge will be high. It will be noted that in general the larger 
dealers had greater investments in delivery equipment than the 
smaller ones. That is in part explained by the fact that many of 




2 />£~t/yr/?y //wFsrwf/vr 



-Average investments per gallon for handling 
and distributing milk. 



26 



BULLETIN 639, U. S. DEPARTMENT OF AGRICULTURE. 



the larger dealers maintained expensive barns and wagons, while 
some of the smaller ones had much less costly delivery outfits. 

The differences in costs of supplies and in the charges for interest 
and depreciation are in the main the result of differences in the per 
gallon investments. Figure 12 shows radical differences in the cost 
of supplies in milk plants. As many of the dealers had operated 
their newly equipped plants for only a short time, and since some 
plants were not arranged efficiently or were not operated at full 
capacity, the most economical use of supplies was not possible. 

Aside from advantages of busi- 



i 



and 








8 



5 




V 


\ 




i 


v' 


5. 





U 


< 


& 


$ 


* 










3.0 



ness experience, however, 
differences in the extent to which 
machinery was run at full ca- 
pacity, the larger dealers were 
able to effect considerable econ- 
omies by the purchase of sup- 
plies in large quantities. 

Figure 13 shows that the larger 
dealers have lower labor costs per 
gallon in plant operations than 
the smaller plants, owing to the 
economies effected through spe- 
cialization of labor. The apparent 
exception in the case of the two 
larger groups is to be explained 
by the fact that a larger propor- 
tion of their output consisted of 
bottled goods than in the case of 
the smaller plants. In delivering 
milk, however, there appears to 
be no definite relation between 
the size of the business and the 
per gallon labor costs. 

The figures of the comparative 
costs in Table XVII represent the 
expenses of handling at the city 
plant and of delivering to the va- 
rious classes of trade. They do not include, however, such expenses 
as are imposed on the business by surplus milk, soured or spoiled 
milk, shrinkage in handling, shortages on delivery routes, and bad 
bills. These items of loss or expense of the business were not obtain- 
able from many dealers, because of a lack of efficient business organ- 
ization or inadequacy of accounting systems to check such losses. 
On account of the omission of those items of expense, Table XVII 
possibly does not bring out all the comparative economies of large 




*~0# //AAJDZ//VG 



Fig. 12. — Variations in charges for in- 
terest and depreciation and cost of sup- 
plies per gallon. 



MARKET MILK BUSINESS OF DETROIT, MICH., IN 1915. 



27 



£>SA/.f/?S G/?Ol//>££> SlCCO/?0//VG ro 
/VCS/Vtt/? OFG/U.CO/VS /f/WO/.£0 OA/LY 





and small businesses. (See fig. 10.) The losses from spoilage and 
temporary surplus or shortage of a supply of milk were compara- 
tively less for the larger dealers. In the case of all dealers, regard- 
less of the size of their business, the losses from bad bills were small. 
Through the use of the ticket system a large part of the retail busi- 
ness was done on advance payments. 

It' is noteworthy that only the larger dealers had expenses listed 
under the item of advertising. Practically all the dealers had ex- 
penses which may have been properly listed under that item, but 
were listed under either administrative or miscellaneous expenses. 
Besides the readily recognized expenses of advertising, practically all 
the dealers made contributions oi 
gifts of various kinds to gain or 
retain the good will of consumers. 
The comparatively expensive de- 
livery equipment of the larger 
dealers also has a certain advertis- 
ing value, although such expenses 
are not listed under that item. 

In this connection it is impor- 
tant to note the lack of uniformity 
in provision made for the adminis- 
trative end of the business, but in 
general the administrative ex- 
penses, which included office ex- 
penses, tended to increase in pro- 
portion to the size of the business. 
The smallest dealers had prac- 
tically no administrative invest- 
ments. See Table XVII.) 
Though the larger dealers gener- 
ally had better administrative organizations, the personal supervision 
which the smaller ones were able to give to the business was an impor- 
tant factor in lowering their expenses. 




//V *>£si/i/r 



*CH 














i — i 




1 




"*J 






20A 




1 






/.s\ 


\\ 


1 7 


■ 


i 


! \ ! 

1 3 1 


ill 


IS 


1! 





















Fig. 13.- 



//v G^/ve/tr 



Variations in cost of labor per 
gallon. 



CONCLUSIONS. 

1. The demands for market milk in Detroit necessitated arrange- 
ments for obtaining a supply from farmers living too far from the 
city to effect an economical distribution of their comparatively small 
production. (Fig. 1 and pp. 2-4.) 

2. The prices paid to farmers by the various dealers competing 
with one another in the market milk business of the city varied con- 
siderably. Milk dealers as well as the farmers were dissatisfied with 
conditions then existing. (Figs. 2 and 3 and pp. 4-7.) 



28 MARKET MILK BUSINESS OF DETROIT, MICH., IN 1915. 

3. A lack of standardization in the construction and equipment of 
country milk stations contributed largely to the varying costs of 
handling milk in the country. (PL I and pp. 8-10.) 

4. Because they owned the country milk stations the larger dealers 
were able to obtain milk more cheaply in relatively distant areas of 
production. (PI. I and pp. 12-14.) 

5. Inconvenient train schedules, lack of satisfactory refrigeration 
facilities, and comparatively high transportation rates prevented 
some dealers from obtaining a supply of milk from certain areas of 
production. (Fig. 1 ; PI. I, fig. 1 ; PI. II, fig. 1, and pp. 3, 11-14.) 

6. The fluctuating daily demands for market milk and its various 
derivatives in the city necessitate the use of proper equipment for 
handling and distributing milk and for the economical utilization of 
temporary surpluses (Fig. 4 and pp. 14-16.) 

7. The variation in costs of preparing milk for city distribution 
was caused primarily by a lack of standardization in plant construc- 
tion and equipment, and by the fact that some plants were not run 
efficiently or at full capacity. (Figs. 11 and 12; PI. II, fig. 2; PI. 
Ill, fig. 1, and pp. 18-19.) 

8. The low cost of delivering milk in wholesale quantities to retail 
stores suggests possible economies by dealers if such a system of dis- 
tribution were practiced by all. (Fig. 9; PI. Ill, fig. 2, and pp. 
19-23.) 

9. The cost of handling and distributing in the city does not vary 
directly in proportion to the number of gallons handled, although 
the larger dealers. do effect certain economies not possible to the 
smaller ones. (Figs. 11, 12, and 13 and pp. 23-27.) 

10. In the case of many dealers there was evidence of administra- 
tive weaknesses which affected not only the internal economies of 
the business but also the relations of the business with producers and 
consumers. (P. 27.) 

o 



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